Published on 27 Apr 2023 on Zacks via Yahoo Finance
3 Communication Stocks Likely to Transcend Industry Headwinds
The Zacks Communication - Components industry appears to be mired in a challenging macroeconomic environment and uncertain business conditions despite a gradual revival in post-pandemic market conditions. In addition, high capital expenditures for infrastructure upgrades, margin erosion, inflationary pressures, supply-chain disruptions driven by the prolonged Russia-Ukraine war and high customer inventory levels have dented the industry’s profitability.Nevertheless, Arista Networks, Inc. ANET, Corning Incorporated GLW and TESSCO Technologies Incorporated TESS might benefit in the long run as demand for scalable infrastructure rises for seamless connectivity with the wide proliferation of IoT, fiber densification and accelerated 5G rollout.
Industry Description
The Zacks Communication - Components industry primarily comprises companies that provide diverse telecom products and services to develop scalable network architecture, demand-driven video solutions and broadband access equipment. These include various building blocks such as small cells, routers and antennas incorporated into equipment and facilities and subsequently utilized by service providers to build networks for end users. The product portfolio encompasses optical and copper connectivity products, hybrid fiber-coaxial equipment, edge routers, metro Wi-Fi, storage and distribution equipment for cable TV operators, modems, EMTAs (Embedded Multimedia Terminal Adapter), gateways, set-top boxes, analog and digital microphones, audio processors, glass substrates for LCD TVs and notebooks, ceramic substrates for mobile and laboratory filtration products.